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3 of Wall Street’s Favorite Stocks Walking a Fine Line

SPB Cover Image

The stocks in this article have caught Wall Street’s attention in a big way, with price targets implying returns above 20%. But investors should take these forecasts with a grain of salt because analysts typically say nice things about companies so their firms can win business in other product lines like M&A advisory.

Unlike the investment banks, we created StockStory to provide independent analysis that helps you determine which companies are truly worth following. Keeping that in mind, here are three stocks where Wall Street’s enthusiasm may be misplaced and some other investments worth exploring instead.

Spectrum Brands (SPB)

Consensus Price Target: $87.88 (33% implied return)

A leader in multiple consumer product categories, Spectrum Brands (NYSE: SPB) is a diversified company with a portfolio of trusted brands spanning home appliances, garden care, personal care, and pet care.

Why Do We Avoid SPB?

  1. Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
  2. Sales are expected to decline once again over the next 12 months as it continues working through a challenging demand environment
  3. Negative free cash flow raises questions about the return timeline for its investments

Spectrum Brands’s stock price of $66.06 implies a valuation ratio of 12.5x forward P/E. Dive into our free research report to see why there are better opportunities than SPB.

Gibraltar (ROCK)

Consensus Price Target: $90.33 (45.8% implied return)

Gibraltar (NASDAQ: ROCK) makes renewable energy, agriculture technology and infrastructure products. Its mission statement is to make everyday living more sustainable.

Why Are We Hesitant About ROCK?

  1. Products and services are facing significant end-market challenges during this cycle as sales have declined by 2.2% annually over the last two years
  2. Competitive supply chain dynamics and steep production costs are reflected in its low gross margin of 25.2%
  3. 2 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position

At $61.94 per share, Gibraltar trades at 12.8x forward P/E. To fully understand why you should be careful with ROCK, check out our full research report (it’s free).

Solventum (SOLV)

Consensus Price Target: $80.14 (6.9% implied return)

Founded in 1985, Solventum (NYSE: SOLV) develops, manufactures, and commercializes a portfolio of healthcare products and services addressing critical customer and therapeutic patient needs.

Why Do We Think Twice About SOLV?

  1. Organic sales performance over the past two years indicates the company may need to make strategic adjustments or rely on M&A to catalyze faster growth
  2. Expenses have increased as a percentage of revenue over the last two years as its adjusted operating margin fell by 4.2 percentage points
  3. Earnings per share fell by 21.9% annually over the last two years while its revenue grew, showing its incremental sales were much less profitable

Solventum is trading at $75 per share, or 13.2x forward P/E. If you’re considering SOLV for your portfolio, see our FREE research report to learn more.

High-Quality Stocks for All Market Conditions

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years.

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today for free.

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